Xbox

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• Latest news Xbox announces major restructuring with 3,200 layoffs and studio divestments

  CEO Asha Sharma announced a company-wide restructuring in a public memo. The plan includes about 3,200 layoffs, divestment of four (possibly five) studios, and broad management changes. Microsoft says the move will shape how Xbox operates over the next 12 months and could affect Game Pass strategy.

• Latest news Xbox to cut 1,600 jobs now, 3,200 by fiscal year end; four studios divested

  Xbox announced Monday it will lay off 1,600 employees immediately and a total of 3,200 by the end of its fiscal year. The company said it is divesting four studios, while the future of Arkane Studios (Dishonored) remains unclear. No further details on specific teams or timelines were provided.

• Latest news Microsoft layoffs hit Xbox; expert faults management and AI strategy

  Microsoft announced 4,800 layoffs company-wide, including 3,200 at Xbox. Commentator Ed Zitron attributed the cuts to management decisions and the company's AI investments. Microsoft said it is adapting to a changing environment, denied that eliminated roles are being replaced by AI, and acknowledged AI is changing how work gets done. The company's stock fell after the announcement.

• Latest news Xbox links 3,200 layoffs to slower-than-expected Game Pass growth

  Microsoft’s Xbox division will cut about 3,200 jobs. CEO Asha Sharma said in a memo that Game Pass "did not grow at the pace we expected" and cited it as a factor in the reductions. The memo did not provide subscriber figures.

• Latest news Xbox CEO: Past bets left business stretched as major cuts begin

  Xbox CEO Asha Sharma said earlier strategic bets — Game Pass expansion, multiplatform moves, and studio growth — spread Xbox too thin and diverted focus from its core business. Microsoft is executing a reset that includes immediate and planned layoffs: about 1,600 roles cut now and roughly 1,600 more over the next year. The company is also spinning out Double Fine and Compulsion, selling Ninja Theory and Undead Labs, and consulting on Arkane Lyon’s future. Microsoft-wide reductions affect about 4,800 positions (≈2% of staff).

• Latest news Steam Machine 'Red Line' LEDs indicate faults but are often fixable

  Early Steam Machine owners reported a so-called "Red Line of Death" LED error, but many cases have been resolved with resets and BIOS updates. Valve's light-bar uses different widths and animations to indicate specific hardware issues like GPU failure or overheating. Steam's support documentation explains the meanings and notes critical error indicators override custom lighting.

• Latest news Arkane Lyon in consultation; Marvel’s Blade status uncertain amid Xbox reset

  Microsoft is undergoing a broad "reset" that includes layoffs, studio sales and other changes. Arkane Lyon has entered a required consultation in France and its future — and the future of Marvel’s Blade — is undecided. Reports say Blade was over-budget and internally delayed from a 2026 target to late 2027; Microsoft maintains no publicly announced first-party games have been canceled.

• Latest news Xbox layoffs reportedly hit ZeniMax Online content teams and senior staff

  Xbox's latest round of cuts has reportedly hit ZeniMax Online Studios hard, with a senior designer saying about half of active content developers were let go. Multiple longtime employees and senior roles have announced layoffs. The moves follow prior Xbox-wide reductions and the 2025 cancellation of Project Blackbird, and the studio's development roadmaps are said to be shifting.

• Latest news Double Fine and Compulsion leave Xbox, regain independence and take their games

  Double Fine Productions and Compulsion Games have confirmed they will leave Xbox and return to independent status. Both studios say they will retain ownership of their game catalogs and take their existing titles with them. The announcements came as each studio reacted to the confirmed change in their corporate relationships.

• Latest news Xbox CEO Asha Sharma aims to entertain over a billion people daily

  Xbox CEO Asha Sharma said she hopes Xbox can "entertain more than a billion people each day." The comment came as the company is undergoing drastic changes. Some observers have described the target as unrealistic given Xbox's current scale.

• Latest news Microsoft cuts 3,200 Xbox jobs and parts with four studios

  Microsoft announced 3,200 layoffs across its Xbox division. The company also confirmed four internal studios are leaving: Double Fine, Compulsion Games, Ninja Theory and Undead Labs. Arkane Lyon is reportedly in talks to be removed as well. Microsoft described the changes as the most significant Xbox restructuring in its history.

• Latest news Asus ROG Ally Xbox X hits $1,000 and emerges as best-value handheld

  Handheld PC prices have risen sharply, pushing many models well above launch MSRP. The Asus ROG Ally Xbox X is now selling for about $1,000 and offers high-end internal specs. An editor who previously criticised its launch price now calls it the best value among current handhelds.

• Latest news Steam Machine shows Xbox‑style red LED error after software update

  A Reddit user reported their Steam Machine displaying a pulsing red LED line—similar to the Xbox 360 Red Ring of Death—after applying a software update. Valve's front LEDs signal system status; red typically indicates a hardware or boot fault and the user was told it points to a GPU issue. The Steam Machine uses mass‑produced AMD components comparable to a Ryzen 5 7540U and Radeon RX 7600M. The owner has contacted Valve support for assistance.

• Latest news Steam Machine hit by first major hardware fault, nicknamed 'Red Line of Death'

  Valve's Steam Machine has reportedly experienced its first major hardware fault. Community members have nicknamed the problem the "Red Line of Death", a reference to Xbox's "Red Ring of Death".

• Latest news Report: Microsoft may close Arkane as Blade delayed to late 2027

  The Verge reports Microsoft is reviewing at least five studios, with Arkane among those considered for closure as part of cost-cutting. Blade’s release has reportedly slipped from this year to late 2027 and is said to have run over budget. Todd Howard and Arkane’s art director have publicly stated development is proceeding and the game is not cancelled.

• Latest news Xbox drops funding for IO Interactive's Project Fantasy; studio faces layoffs

  Xbox has pulled out of a deal to fund and publish Project Fantasy, an online fantasy RPG developed by IO Interactive. IOI, the studio behind Hitman and 007 First Light, is facing layoffs as a result of the funding withdrawal. Details were reported by Eurogamer.

• Latest news Xbox leadership shakeup prompts branding, pricing and hardware shifts

  Microsoft's Xbox division saw major leadership changes in February, with Phil Spencer and Sarah Bond exiting and Asha Sharma and Matt Booty stepping in. The new team quickly ended the "This is an Xbox" ad campaign and cut Xbox Game Pass prices after a prior 50% hike. They confirmed new high-end hardware (Project Helix), rebranded the organization as XBOX, and ran a June 7 showcase with translucent Series X giveaways.

• Latest news Kojima’s Xbox-exclusive OD reportedly safe amid Xbox studio cuts

  Hideo Kojima’s console-exclusive horror game OD is reportedly still in development and will be published by Xbox, according to IGN. The project remains at Kojima Productions and involves actors Sophia Lillis, Hunter Schafer and the late Udo Kier, with collaboration from Jordan Peele. No release date has been announced; the update arrives as Xbox undergoes reported studio changes and funding shifts.

• Latest news Xbox ends publishing deal for IO Interactive’s Project Fantasy

  IO Interactive announced Project Fantasy, an online fantasy RPG, in 2023. The studio had planned to work with a third-party publisher rather than self-publish. Xbox was that third-party partner but has now pulled out of the deal. The game's future funding and publishing arrangements are not detailed.

• Latest news Microsoft pulls funding for IO Interactive’s Project Fantasy as Xbox refocuses spending

  Microsoft says it withdrew funding for IO Interactive’s fantasy project as it “focuses on our highest priorities.” The company maintains overall game investment this year should be roughly equal to last year, but is shifting where it invests and which projects it backs. IO Interactive says Project Fantasy will still be completed, while announcing staff layoffs. A wider Xbox reset under CEO Asha Sharma could include layoffs, studio closures or divestitures, and cancellations, with reported cuts beginning July 6.

• Latest news Reports: Microsoft may close Arkane Studios, cancel Blade amid Xbox layoffs

  Reports say Microsoft is considering shutting down Arkane Studios and canceling its upcoming Blade game. Arkane is known for Dishonored, Deathloop and Prey (2017). Microsoft is reportedly planning a large round of Xbox studio layoffs to be announced next week.

• Latest news Microsoft ends funding for IO Interactive's Project Fantasy

  IO Interactive announced an external partner has pulled funding for Project Fantasy, the online fantasy RPG it revealed in 2023. The partner was confirmed as Microsoft, which says it is refocusing investment priorities amid broader Xbox restructuring. IOI said the loss of funding will lead to immediate staffing decisions and it will support affected employees. The announcement follows IOI's recent commercial success with 007 First Light.

• Latest news IO Interactive begins layoffs after Xbox ends funding for Project Fantasy

  IO Interactive has started layoffs after an external partner ended its relationship, affecting development of the unlaunched Project Fantasy. Xbox confirmed it was the partner and says it has pulled funding as it reallocates investments. IO calls the cuts short-term, pledges support for affected staff, and says Project Fantasy remains in development; the studio's 007 First Light recently sold 3 million copies.

• Latest news Report: Microsoft may cancel Marvel's Blade and consider closing Arkane

  The Verge reports Microsoft is considering cancelling Marvel's Blade and closing at least five studios, including Arkane Studios in Lyon. Blade was reportedly delayed from 2026 to late 2027 and is over budget; no gameplay has been released since its 2023 announcement. Microsoft is said to be exploring sales for some studios to avoid closures. Layoffs tied to an Xbox restructuring are expected to begin July 6 and could affect hundreds to around 1,000 employees.